Crypto Exchanges Remove Litecoin Over Privacy Reasons

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Litecoin will be delisted on Bithumb and Upbit, two South Korean crypto exchanges, due to changes to the coin that allow for greater privacy when transacting.

In their reviews for Litecoin, Bithumb and Upbit said they were closing market support for the 20th-largest cryptocurrency by market capitalization because its newly-enabled Mimblewimble Extension Blocks (MWEB) network upgrade conflicts with South Korea’s anti-money laundering (AML) regulations.

Upbit highlighted an option in Litecoin trading that “allows users not to expose transaction information”, raise concerns this “anonymous transmission technology” will likely be added to the functionality of the coin.

Marketplace support for Litecoin using Upbit will close on June 20, and users will then have one month to withdraw their funds from the exchange by July 20.

Bithumb works faster. In his radiation warningthe exchange emphasized its responsibility to “protect [its] users and to build a transparent market for digital assets. This will prevent users from depositing Litecoin on June 8 and give them until July 25 to fully withdraw their Litecoin from the exchange.

In the United States, Litecoin is available on most major cryptocurrency exchanges, including Coinbase, FTX US, and Binance US. It was also one of the first cryptocurrencies to be available for purchase through Robinhood. back in 2018but the movements of the South Korean exchanges could put the future of the coin in question.

Coinbase, Robinhood, Binance US, Kraken, Gemini, FTX US, Crypto.com all currently offer Litecoin trading on their platforms and did not immediately respond to requests for comment.

In the past, exchanges have walked lightly around so-called privacy coins which use advanced privacy techniques and allow operators to maintain their anonymity. The most commonly used privacy coins are Zcash and Monerowhich have a total market value of nearly $4.7 billion when combined.

The anonymous nature of transactions using this breed of cryptocurrency is useful in illicit activities and is a potentially valuable tool for scammers and hackers to launder their funds. A recent Reuters the investigation claimed that Binance served as a “conduit” to launder $2.35 billion in funds and that Monero was critical to the success of nefarious actors trying to clean up their ill-gotten crypto using the exchange.

Binance called the investigation “grossly misinformed” and suggested it was based on “outdated information from 2019 and unverified personal attestations as a crutch to establish a false narrative,” in a statement shared with Decrypt.

Litecoin is one of the oldest and most established cryptocurrencies; at one point it was the top three coins by market capitalization in 2017. Although it is still available on virtually every crypto exchange in the United States, this could very well change in the future if companies take measures similar to Bithumb and Upbit.

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